Whole Foods co-CEO says grocer wants to open 40 more stores in Canada

Whole Foods eyes 40 more stores openings in Canada

MONTREAL • U.S. grocer Whole Foods Market Inc. says it could open 40 or more stores and eventually tally $1-billion in annual sales in Canada as part of a wider expansion that continues unabated.

“By the time we actually get to the place of being able to open those stores, I expect the market will continue to evolve,” company co-chief executive John Mackey told reporters at the C2-Mtl conference Wednesday. “So it probably is more than that.”

He declined to provide an exact timeline for the expansion.

Austin, Texas-based Whole Foods’ goals for Canada are ambitious considering it has only 9 stores here currently, all of them in B.C. and Ontario. The company, which is the largest U.S. natural and organic supermarket chain, is scouting for a location in Montreal, Mr. Mackey said.

The company went public in 1992 with 12 stores and $92-million in annual sales. It now has about 350 stores, the vast majority of them in the United States, and yearly sales of $12-billion.

The company has previously said that it could have 1,000 stores one day. It is opening about 30 stores a year now but may increase that pace, Mr. Mackey said.

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Same-store sales at Whole Foods outlets open at least one year rose 6.9% in its most recent quarter. On average, the company has tallied same-store sales growth of 8% over the last 30 years, Mr. Mackey said.

The CEO said the company is highly “picky” in choosing specific store locations. Expanding into Quebec means the company will run up against possible unionization, which Whole Foods has carefully avoided in the United States.

Quebec’s powerful unions will be chomping at the bit to sign up Whole Foods employees if it comes to the province with any significant scale. Rivals like Métro Inc. have full unionization at their corporate and franchisee locations.

“[Quebec] has stronger labour unions than in some other parts of Canada,” Mr. Mackey acknowledged Wednesday. “So it is a factor but… it wouldn’t prevent us from coming here.”

The CEO has been less diplomatic in his previous comments about organized labour. He once told a reporter: “The union is like having herpes. It doesn’t kill you but it’s unpleasant and inconvenient and it stops a lot of people from becoming your lover.”

More recently, Mr. Mackey published an opinion piece in the Wall Street Journal arguing that the U.S. government should not be providing health care. He was subsequently slammed by left-leaning Liberals, who then organized boycotts of Whole Foods.

However, the man the New Yorker called a “right-wing hippie” in a 2010 profile seemed full of praise for Canada’s universal health care system on Wednesday, declaring: “I’m very impressed with Canada. Canada is a country that, in many ways, is one of the most rapidly evolving countries in the world in terms of the overall consciousness of it. You’ve got a good, obviously good social welfare safety net. At the same time, you’re entrepreneurial. You’re creative. Your taxes make more sense than American taxes.”

The United States would be very well served to pay a lot more attention to Canadians, he said. “You’re doing a lot of things right. And Americans are doing a lot of things wrong. So the problem in America, Americans are too arrogant to want to look at anybody else. It never ceases to amaze me.”

Mr. Mackey, who says he travels with a rice cooker, came to Montreal’s C2Mtl Conference, a gathering of business and creative people curated by local advertising agency Sid Lee, largely to talk about his recent book Conscious Capitalism. The main idea of the book is that business should have a higher purpose than simply making money.

Food in the United States has never been cheaper than it is today, Mr. Mackey said, representing only 8% of a family’s disposable income spending. And yet Americans have among the world’s highest obesity rates because they are buying the most expensive foods — processed and animal-based products, he noted.

“The healthiest food you can eat is not expensive,” he said. “But it requires you know how to cook.” The multi-millionaire said he spent about 30 cents on the raisins, oats, and almond milk he ate for breakfast that morning.

Many high-profile investors are bullish on Whole Foods because they believe the younger millennial generation want their food “vetted and verified,” as CNBC business broadcaster Jim Cramer put it Wednesday in a column.

Mr. Mackey believes the company can deliver exactly that. He tells an anecdote about a store the company opened in San Antonio, Texas in the 1990s. Mr. Mackey’s wife, who is from the area, warned him not to open an outlet at that specific location, saying the locals wouldn’t buy the organic food Whole Foods sells. He took her advice but just four months ago, 22 years later, the company opened another store at almost the exact same spot as the previously abandoned one.

“I’m walking around the store with my wife and the place was packed. The store is very successful,” Mr. Mackey recalled. “I looked at my wife and said ‘You know all those people you said weren’t going to shop in our store? They’re dead. These are their children. And they’re shopping with us.’ The world continues to evolve.”